[JakkTrent]

Is there an example of this happening? I'm supposed to believe that we ask for money back from foreign countries that have stockpiled dollars as their reserve to finance domestic spending - instead of just printing money.

Why would we do that?

[joshdata]

We don't ask for dollars back. The government asks for a loan that pays interest and lots of people gladly want to make that loan - like probably your retirement investments. This is where the national debt comes from. If we printed money there would be no national debt.

[fnordpiglet]

Precisely. In fact a lot of reserves aren’t even dollars but are actually us treasury debt denominated in dollars. Treasury debt is treated as cash in most of the world because the treasury market is so liquid and it’s guaranteed by the 14th amendment of the constitution. no one wants to see the 14th invoked because a) it means our political system is so broken we are willing to default, b) it’s possible some conservative court would deny the clear language and take the backstop that insures the debt away. The 14th amendment though is basically supported by printing money rather than borrowing, which is the (c), as it’s diluting.